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JAN

Becoming a Full Time Real Estate Investor

By Gord Lemon / In Blog, Real Estate Inspection / 0 Comment

Real Estate Investing as a Business

Becoming a fulltime real estate investor is a highly desirable way to change one’s financial position, net worth and retirement. Sadly, many people jump into real estate as a get rich quick option, end up making a bad choice on a property, have a bad time with tenants, lose time, money and go through alot of stress in the process and never in fact become a full time real estate investor.

Becoming a full time real estate investor is not an impossibility, in fact it is easier than a lot of people may think, however, it does not come without work and education.

The average, amateur investor, is one who typically has a regular job and has purchased a property to either renovate and flip or rent. They have saved the downpayment with their hard earned money and mortgage qualifies. Pretty standard story.

This method often requires way too much time for the amateur investor, who is a fulltime employee in another business and usually has a family. Conversely, what some “fulltime” real estate investors do is quit their jobs, buy properties with their own money, with the intent to live off positive cash flow and/or renovate for a living.

There is nothing wrong with this method, however, there are a few flaws in this process:

1. the investor is using their own money,
2. the investor is using their own credit to mortgage qualify,
3. the investor is using lots of their own time,
4. the investor is open to liability.

To become a fulltime investor and build a large portfolio, one needs to be using their expertise (more on this later) and OPM (other people’s money) through the use of joint ventures and ultimately syndication.

Becoming a fulltime real estate investor means you are your business. This has many tax advantages. Some deals are structured in a manner to avoid many capital gains issues. You are able to treat this business with regular business expenses just like any other sole proprietorship business. Your goal is to get paid on a regular basis. I don’t mean just from time to time, not just from a small amount of monthly cash flow based on a small return on investment that you have created with your own money but from a multiple stream you create which pays you regularly.

We want to be able to create a continuous return on investment from our time leverage, our education skill and our thinking. The following series of articles can highlight many ways in which one can become a fulltime real estate investor so stay tuned.